Investments advisers had been excluded the definition of “financial institution” under the Bank Secrecy Act. At least until today. The Financial Crimes Enforcement Network at Treasury issued a final regulation today that changes that exclusion. Most registered investment advisers are now included in the definition and will have to comply with the strict requirements of the Bank Secrecy Act.
The compliance date is January 1, 2026.
“The final investment adviser rule will apply anti-money laundering/countering the financing of terrorism (AML/CFT) requirements—including AML/CFT compliance programs and suspicious activity reporting obligations—to certain investment advisers that are registered with the U.S. Securities and Exchange Commission (SEC), as well as those that report to the SEC as exempt reporting advisers. The rule will help address the uneven application of AML/CFT requirements across this industry.”
Registered investment advisers will need to get up to speed on filing Suspicious Activity Reports and the other requirements of the BSA.
Sources:
- Financial Crimes Enforcement Network: Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers and Exempt Reporting Advisers (to be Published on 9/4/2024)
- FinCEN Issues Final Rules to Safeguard Residential Real Estate, Investment Adviser Sectors from Illicit Finance